Landis+Gyr Group AG

Ladies and gentlemen, welcome to the Analysts and Investors Full Year 2023 Conference Call and Live Webcast. I'm Iruna, the course call operator. I would like to remind you that all participants will be in listen-only mode and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and 1 on your telephone. For operator assistance, please press star and 0. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Eva Borowski, SFPIR and Corporate Communications. Please go ahead, madam.

Thank you, Marina, and good afternoon, good morning, everyone. As you know, earlier today, Landis & Gear issued its financial year 23 results ad hoc release and accompanying presentation. You can find these documents on our website. Before we get started, we want to emphasize that some of the information discussed today contains forward-looking statements. and we want to explicitly emphasize that there are numerous risks, uncertainties, and other factors, many of which are beyond Landis & Gere's control, that could cause Landis & Gere's actual actions or performance to differ materially from the forward-looking information and statements made on this conference call or in this presentation. Consequently, Landis & Gere can give no assurance that those expectations will be achieved. For more information, please see page 2 of the presentation in our press release issued today. This conference call will follow the presentation, so we suggest that you have it on your screen or otherwise available to follow along with our remarks during the first part of this call. Afterwards, you will have the opportunity to ask questions, and Miruna will provide further instructions as we start the Q&A. With that short introduction, I'd like to turn over the call to our Chief Executive Officer, Werner Lieberherr.

Thank you, Eva. Good afternoon, good morning, everyone, and welcome to our financial year 2023 results. I'm here with Elodie, our CFO, and Eva, as you just heard, our Senior Vice President of Investor Relations and Corporate Communications. And we are very pleased you have all been able to join us today. We are pleased to report strong results for FY23, delivering above our guided ranges for the full year and demonstrating our ability to deliver continued strong growth and margin expansion. The return to largely normalized market conditions and a strong focus on backlog execution drove growth and supported our ability to serve customers' demand even better throughout the year. Continued strong order intake and a new record backlog show the trust our customers have in our solutions and underpin the resilient nature of our company. Additionally, the rapid push for electrification increases the demand for energy efficiency and grid resiliency solutions. These factors, paired with our strategic transformation, provide a solid foundation for sustained profitable growth. The increased need for intelligence at the grid edge positions us in the sweet spot of the energy transition as we continue to expand our end-to-end solutions to enable our customers to manage energy better and drive the decarbonization of the grid. Now let's talk about what's been happening over the last year and move on to slide three. We are pleased to announce an order intake of almost $2 billion driven by Americas, resulting in a book-to-bill of above one and a new record backlog of almost $3.8 billion. And we were able to deliver strong net revenue growth over 15% year-over-year in constant currency, making FY23 our best year ever since IPO. Adjusted EBITDA margin came in above the guided range with 11.4% due to operating leverage and steady recovery of supply chain cost. Free cash flow returned to robust levels with over 91 million US dollars. And on June 25th, a progressive dividend of 2.25 Swiss francs per share will be proposed to the AGM. In addition, we are excited about new strategic investments and partnerships with Spen and Prusa, which allow us to further strengthen our portfolio to equip our customers with integrated end-to-end flexibility management solution. Moving on to slide four. Our portfolio enables us in a unique way to have a direct sustainable impact. In FY23, we were able to avoid over 8.9 million tonnes of CO2 emissions through our installed base of smart devices using a new methodology developed together with Carbon Trust. As a result, we were able to help avoid almost seven times more carbon emissions than we produced. With the approval of our science-based target initiative, decarbonisation targets, we continue to improve our performance on our journey to reduce carbon emissions. and we continue to measure our ESG progress against 20% of our short-term incentive for all eligible employees. On May 30th, we will publish our sustainability report as part of our annual report and invite you to take a look on our website once these documents are published. Let's turn to slide five and have a look at the developments in each region. I'll start with the Americas led by Sean. We have continued to build strong momentum through FY23 with key strategic wins and exciting deployment milestones. We were able to book a stellar order intake of over $1.2 billion, a book-to-bill ratio of 1.1, resulting in a backlog of almost $3 billion. And for the first time, the Americas region has delivered revenue above the $1 billion mark. With well over 200 agreements signed, doubling year-over-year, FY23 was a very successful year for the region, and we see good momentum for future growth, but the pipeline remains strong and infrastructure investments pick up steam. With many large AMI rollouts underway, which include national-grade AES Ohio and LG&D, we continue to replenish our record backlog. In smart metering, we were able to win a few notable contracts, including EPCOR in the city of Edmonton, the city of Florence, Alabama, and Brownsville. We also made fantastic progress in grid edge intelligence with wins that include Fortis, Alberta, and Tidmont. Lastly, in smart infrastructure, we have expanded our reach as well with a win by Anapro for level two EV chargers, AP Texas and Berkeley. In summary, We are proud to be a provider of creative infrastructure and continue to support great resilience and modernization and flexibility solutions with state-of-the-art cybersecurity applications. On the next slide, I would like to briefly share an update on our leading Revelo platform. Revelo is the only grid sensing platform available today with streaming high-resolution waveform data on every device, providing real-time visibility into where DERs are on the grid, real-time awareness and grid condition. actionable insights for engaged prosumers and overall grid reliability through unparalleled edge intelligence. On this slide, you can see a selection of our Revello customers, which demonstrates the wide adoption of this latest technology. In order to realize the true value and benefits of a connected grid, it requires a grid sensing platform that was designed to evolve to support utilities of every size for the next 20 plus years. We are proud to report that we have now entered the mass deployment phase, including numerous edge apps spanning consumer engagement, grid analytics, demand response, cybersecurity, and safety. Today, over 5 million Rivelo sensors and multiple grid edge apps are contracted and in active deployment. Real-time visibility at the grid edge is a key driver for sound analytics and flexible management solutions. Let's move on to slide seven and take a closer look at the mayor led by Bodo. In FY23, we have successfully expanded our presence across several markets, including Switzerland, Germany, Finland, South Africa, the Middle East and Central and Eastern Europe. This expansion was closely linked to the swift implementation of both ongoing and newly initiated projects, while deployment focus was strongly tied to great edge solutions and smart metering infrastructure. We can also see these developments in the regions in both revenue growth of over 10% and margin improvement by 4.9% and will continue to work diligently growing our EMEA region profitability going forward. In smart metering, we were able to further strengthen our position with numerous wins, including Oiken in Switzerland and E.ON in Sweden. Despite the slowdown in rollouts in the UK, we have delivered over 1.6 million smart meters and successfully defended our position as the largest supplier in an increasingly competitive landscape. As a result, we were able to secure an additional 800,000 endpoints with two of the largest UK energy suppliers. In GreenEdge Intelligence, we have successfully supported our customers with accelerated rollouts to combat the energy crisis and enable the energy transition. Among others, we were able to win contracts with SES in Switzerland and Israel Electric. In smart infrastructure, our EV solutions business was able to secure important wins with key e-mobility players, including EDP, Allegro, and Moon, a subsidiary of Porsche, who awarded us a frame contract for both our Inch Pro and Inch Duo chargers in Europe. While EMEA continues to recover from supply chain headwinds, we continue to drive innovation. Over the last year, we have seen some great wins in the region, positioning EMEA well to capture profitable growth in the coming years. Now let's take a look at Asia-Pacific on slide 8. With David McLean, I'm pleased to present a new internal leader for our Asia-Pacific region. With Steve's well-deserved retirement, we have a worthy successor in Dave, who has been working for many years alongside Steve, and we have concluded a smooth transition on April 1st. We are well positioned in our target markets for emerging smart water opportunities across Southeast Asia and we are working closely with our customers in the Philippines and Thailand to support their AMI rollouts. While focusing our expertise in India as a leading services and solutions provider, Australia, New Zealand and Hong Kong remain cornerstones of the region's success. After seizing manufacturing activities in India, we see a decline in revenue, while we saw a nice development upwards for the EBITDA margin coming in at 11%. In smart metering, we have secured a number of notable wins, in particular with a large customer investment in Australia, as well as a leading gas utility in Victoria, Australia. In addition, we continue to keep the momentum going in Hong Kong. In grid edge intelligence, we received an order from Intellihub for the Australian Power of Choice market, And our newly formed joint venture with EasySoft allows us to continue to serve the market after refocusing our efforts on software, services and solutions. In smart infrastructure, we continue to expand our services revenues with continued growth in SaaS or software as a service, including wins with Eureka, Energy Queensland in Australia and Watercare in New Zealand. In addition, we are pleased about steady progress in our EV business with Thunder Grid as a great addition, bringing home wins to serve the region with transportation electrification needs. Overall, we see a continued positive trajectory that allows us to drive new business. Now, let's move on to slide nine, as I would like to share some more details about a few exciting new partnerships. Let me start with our strategic partnership with SPAN, a leading provider of smart panels and home electrification solutions. Our partnership will focus on unlocking electrification and DR flexibility at the grid edge to cost-effectively advance electrification, create grid flexibility and build resilience. Our grid edge intelligent solutions paired with SPAN HOME's energy management system offers superior metering and control capabilities, redefining AMI 2.0 and enabling the cost-effective grid management of the future. In essence, a multi-asset virtual power plant. We are excited to keep you updated on the progress we have already made with a few selected launch customers. On slide 10, I will share details on another partnership with Prusa. By entering into a strategic partnership with Prusa, a leading provider of power electronics, we are expanding and enhancing our EV solutions portfolio. Together, we are bringing DCT and inductive charging solutions to the market. The inductive charging system is already approved for operation in Europe, China, North America and Japan and will produce notable revenues from FY25 onwards. As a result, we are further strengthening our position in the EV solutions market for hardware, software, and mobile apps. Now, let's turn to slide 11 and take a closer look at our consolidated results. We saw significant revenue growth led by Americas and EMEA, supported by catching up on pent-up demand of around $120 million, and continue to see positive momentum based on our record backlog. demonstrating the trust our customers have in us and our solutions. Adjusted EBITDA expansion was driven by steady recovery of supply chain costs, operating leverage and operational efficiencies. Earnings per share, excluding the IntelliHub divestment, increased by 112.4%. Overall, I am very pleased with the results and now Elodie will give you a more detailed review of the financials. Afterwards, I will come back to our guidance before we open up the call for questions. Elodie, please.